Global rating agency, Fitch Ratings Monday said the suspension of the
According to the agency, the reaction of the financial markets to Sanusi's suspension was the first major test of "the more credible macro policy regime Sanusi established". Sanusi was suspended over allegations of financial recklessness by the presidency.
A report by Fitch stated that if the panic and selling pressure in financial markets are sustained, it would increase inflationary pressure, making it more likely that the
"The failure of
"International reserves have been falling since last April and were
"A larger cushion would be positive for the credit profile. Progress on broader structural reforms remains mixed. The Petroleum Industry Bill (PIB), uncertainty regarding which has caused new investment to slump, remains stalled.
"One of its provisions would be to break up the
It added: "Meanwhile, electricity reforms continue, although a significant rise in production remains some way off. Agricultural reforms are also progressing.
"The budget is still in the
"This reduces the risk of an overly stimulative fiscal stance that would increase the debt burden, which remains low, at around 20 per cent of GDP. However, the low ECA and dwindling international reserves also mean the cushion against shocks is being depleted."
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